CORN HIGHLIGHTS:

• The corn market succumbed to the path of least resistance and traded lower in sympathy with neighboring wheat and soybean markets. The prospect of solid yields this harvest, a sluggish export pace (though solid last week), and the continued movement of corn into the cash market remain bearish factors.
• Yesterday’s EIA data showed ethanol production rose to 1,100 thousand barrels per day (tbd) last week, up from 1,072 tbd the previous week and 5% higher than a year ago. Nearly 111 million bushels of corn were used, averaging 15.8 mb per day, exceeding the 14.7 mbd required to meet the USDA’s target.
• The USDA reported this morning that private exporters sold 110,490 mt of corn to Mexico and 132,000 mt to unknown destinations, both for delivery in the 24/25 marketing year.
• Today’s Export Sales report showed an increase of 4.7 mb in corn sales for 23/24 and a 50.8 mb rise for 24/25, slightly exceeding the average trade expectations. While weekly sales were strong, total new crop commitments remain sluggish, with only 14% of the USDA’s projection sold versus the 18% average for this time of year. Last week’s corn export shipments reached 45.5 mb, surpassing the 37.7 mb needed weekly to meet the USDA’s 23/24 export target of 2.250 billion bushels. The primary destinations were Mexico, Japan, and Colombia.
• The Pro Farmer crop tour published yield results for Illinois and western Iowa yesterday. Illinois showed a yield potential of 204.14 bpa, while western Iowa showed potential yields ranging between 176.6 bpa and 195.9 bpa. Overall, the numbers were above last year’s tour levels. The tour moved into southern Minnesota and central and eastern Iowa today.

SOYBEAN HIGHLIGHTS:

• Soybeans ended the day significantly lower wiping out nearly all of the previous gains the November contract had made for the week as the Pro Farmer crop tour finds potentially big yields that could end up being record large. Improved chances of rain in the central Corn Belt have added pressure as well, and both soybean meal and oil ended the day lower as well.
• Today’s weekly Export Sales report saw a decrease of 1.6 mb of soybean export sales in 23/24 but an increase of 61.6 mb for 24/25, which was toward the higher end of trade estimates. Last week’s export shipments of 15.5 mb were below the 17.9 mb needed each week to meet the USDA’s export estimate of 1.700 bb. Primary destinations were to the Netherlands, Mexico, and Egypt.
• Domestic demand has been stout as well, with crush margins reportedly ranging from $2.10 to $2.60 per bushel in the Corn Belt which has given processors a large incentive to buy cash soybeans to crush. This should pair with the uptick in export demand recently, but trade is more focused on the large crop that will likely be harvested this fall.
• This morning, the USDA reported private export sales totaling 198,000 metric tons of soybeans for delivery to China during the 24/25 marketing year and 105,000 metric tons of soybean cake and meal for delivery to Vietnam for the 24/25 marketing year.

WHEAT HIGHLIGHTS:

• Wheat closed lower, led by double-digit losses in spring wheat futures. Pressure stemmed from a sharp rebound in the US Dollar Index, as well as another down day and a new near-term low for Paris milling wheat futures.
• The USDA reported an increase of 18.1 mb of wheat export sales for 24/25. Shipments last week totaling 17.3 mb, exceeded the 16.0 mb pace needed per week to reach the USDA’s export goal of 825 mb. Wheat sales commitments have reached 346 mb for 24/25, up 31% from last year.
• The two largest railways in Canada shut down as a strike began last night. Canadian National Railway and Canadian Pacific Kansas City Ltd account for nearly 80% of Canada’s freight shipments. Additionally, BNSF railroad in Mexico suspended the issuance of new permits due to congestion. These rail issues are raising concerns about the logistics of grain movement, which added pressure to the grain complex today.
• Adding to bearishness in wheat is talk that the Chinese crop may be record-large at 138.2 mmt. As a net importer of wheat, this could reduce their need to import grain, which may pressure both US and global export markets.
• According to the USDA, as of August 20, approximately 21% of US spring wheat acres are experiencing drought. This is unchanged from the previous week, and conditions remain favorable in major producers North Dakota and Minnesota. However, drought in winter wheat areas has expanded 2% from last week to 45%, which may affect the establishment of the winter wheat crop that will soon be planted.

DAIRY HIGHLIGHTS:

• Spot cheese fell 3.8750 cents today to close right at $2.15/lb with barrels falling 6 cents. Spot whey was down a quarter cent but enters Friday up 1.50 cents.
• This move had Class III futures on the defensive with the September and October contracts down more than 60 cents.
• Both Class IV spot products were down today with butter giving back a penny and powder a half cent. They are mixed on the week so far.
• Most Class IV contracts were unchanged or higher, but the second month September and October contracts were even from Wednesday’s finish.

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Author

Brandon Doherty